Business Process Standardization (BPS) – How to Approach It Correctly?

Business Process Standardization (BPS) is a way out of chaos for organizations that do not use outsourcing solutions. It protects against resource waste, increases production stability, and facilitates the management of similar processes while maintaining appropriate quality. Above all, however, it allows companies to do more in less time based on a predetermined pattern. In today’s article, we look at the essence of business process standardization, its importance for organizations, and provide tips on how to implement BPS step-by-step to increase production efficiency.

Business Process Standardization (BPS) – definition. Business Process Standardization and integration

In practice, BPS means that a company authorizes one specific way of executing a given process. It will therefore always be performed in the same way. This is possible through the implementation of so-called best practices, designed to maximize process performance and efficiency. These usually include automation. “Best practices” change as processes evolve. For example, car insurance valuation involves collecting various data and performing several steps. BPS defines these steps and their sequence, ensuring the process is carried out the same way every time a customer submits an inquiry.   Standardization brings order and ensures uniformity. It also allows for quickly identifying the person responsible for a given element and exposes all potential problems that may arise “along the way.” For it to work flawlessly, the integration of systems, processes, and software is necessary, including a BPM platform if one is in use. These two practices combine and consolidate important information in one place and create a uniform and consistent way of executing workflows.

What are the advantages of business process standardization?

The greatest benefits of BPS include:  

• Increased efficiency

Users can execute processes with minimal resources while optimizing the value they derive from them. This leads to an overall reduction in costs, which is a natural effect of increased efficiency. It is estimated that by the end of 2023, business process standardization supporting hyperautomation will lead to a reduction in operating costs by as much as 30%.

• Higher productivity

When organizations optimize business processes using best practices, they can significantly increase their productivity. As one of the first steps in implementing intelligent automation, BPS is essential for reducing processing time, which can be as high as 60%!

• Improved customer satisfaction metrics

Another benefit of process standardization is improved customer satisfaction (e.g., with service). Increased productivity and process efficiency shorten valuable waiting times, such as for a doctor’s appointment.

• Regulatory compliance

Businesses operating in strictly regulated areas, such as finance or healthcare, must comply with many regulations. Failure to comply can potentially result in fines of hundreds of thousands, if not millions of zlotys. A violation of GDPR alone can lead to a loss of up to 4% of annual revenue. Process standardization ensures that employees take the right steps to maintain compliance and not expose companies to high penalties.

• Ability to verify information

Organizations no longer have to waste time wondering what led them to make a specific decision or how data was lost. The transparency of standardized processes allows for auditing individual areas to check exactly what happened in the case of a specific business function.

Are there disadvantages to process standardization in an enterprise?

If migrating a process from a local level to the entire enterprise (so-called global business process standardization) is involved, in addition to benefits such as a positive impact on transparency, communication, and collaboration, costs must also be considered. The latter include, among others, the inability to implement innovations and improvements in individual departments or units of the company. It is also important to understand that every organization has different needs and resources for which it should develop its entire quality strategy. Therefore, there will be cases where global process standardization will not make sense. This most often happens when organizations have limited IT resources or individual company branches differ significantly in terms of business.  

How to implement BPS in an enterprise?

Business process standardization and the integration of appropriate data sources can be started by taking three key steps. This will ensure that processes are not only uniform but also as efficient and beneficial as possible. BPS implementation consists of:

• Process analysis (e.g., using the BPD method)

This is the starting point where organizations examine different ways of executing processes and decide which one provides the most value while reducing the time and resources required to achieve goals. It is important to consider all duplicate procedures to ultimately choose the best one. By considering every possible option, you can select the best elements from each to maximize productivity.

• Creating and implementing standards

The second step to process standardization is repeating it in the same form every time it is required. It is not enough to simply create guidelines; you must also ensure they are put into practice. It should be remembered that automation can streamline and accelerate these processes, allowing organizations to optimize their overall utility.

• Continuous process improvement

The final step is evaluating processes for points of change, improvement, and additions. Through regular analysis, organizations can rest assured that they remain profitable and as helpful as possible. For example, it is a good idea to check where to use aspects of machine learning and AI to accelerate them even further.    

Is the next step of BPS, BPM (Business Process Management)?

The answer is: yes! Business process standardization is one of the first steps toward automation using BPM. Moreover, it is predicted that by 2026, the Business Process Management market will grow to as much as 16 billion dollars! Automation of standardized processes is crucial from the point of view of transparency, the ability to identify specific elements, and the analysis of final results. For example, in an insurance company, this makes it possible to efficiently prepare rulings in response to customer claims. Automation also has a range of strategies and tools that can integrate with artificial intelligence (such as Shift Left), which further increase efficiency.    

BPS and DAPs (Digital Adoption Platforms)

Another solution that helps organizations gain access to state-of-the-art technologies through processes is a Digital Adoption Platform (DAP). Many businesses do not use the full potential offered by modern applications because they cannot effectively manage master data. Most often, however, this happens precisely because their procedures are outdated or do not work at all. DAPs provide solutions that ensure all processes necessary for the integration of specific technologies. They offer support in their implementation and the standardization described in this article. Thanks to this, new applications are incorporated into daily work, becoming an integral part of businesses.